Demand Outpacing Supply in Sydney

Sydney real estateAn article on the website Your Investment Property suggests that vacancy rates are too low and that supply in Sydney is not keeping up with the force of demand made by investors.

Demand outpacing supply in Sydney

For a situation of parity to be recognised, vacancy rate should be near the 2% mark. At the moment, it is floating close to the 1.7% mark, which amply states that any fear about generous investor lending in baseless.

Very low vacancy rate

In Inner Sydney, vacancy is rallying around 0.1% whereas in outer Sydney, the scene is only a little more lenient with the zone hovering around the 0.3% mark. It is the third month, reports that article, that the vacancy rate has remained glued to the 1.7% mark.

You can read the original article here.

I think what the article categorically states through statistics is that the teeming multitude of Sydney investors are still soaked in the positive effect of the perceived boom phase. While the vacancy rate is unlikely to move from where it is, the prices might mellow down from here.

Sydney’s rise is not meteoric

Because we have ridden on the back of successive phases of low prices, the recovery and consolidation have seemed like a phenomenal rise. However, the rise of Sydney has been nowhere near meteoric and previous growth phases have shown better overall results for capital cities (albeit Sydney and Melbourne were laggards in the previous growth phase).

How do you weigh this growth cycle against the previous one?